Estimate of Small Businesses in the Information Technology Industry in the U.S.

• There are more than 557,000 software and IT services companies in the U.S.
• Tech startups/new business units launched in 2019 were estimated at 13,400 businesses.
• According to Gartner, "small business is usually defined as organizations with less than $50 million in annual revenue."
• In addition, SBA sizes software publishers (responsible for producing and distributing computer software), under the NAICS code 511210, as those with revenues of $41.5 million.
• According to the Small Business Association (SBA), small businesses in the U.S.accounted for 99.9% of all U.S. businesses in 2019.
• Assuming that this proportion is accurate for the software and IT services sector, then there are about 556,443 (99.9% of 557,000) small software and IT services businesses in the U.S.
• The proprotion of the key categories in the U.S. IT industry are: software, 20%; devices and infrastructure, 17%; IT + business services, 30%; emerging tech, 13%; and telecom services 20%.

Summary of Findings

• In this preliminary hour of research, we determined that information on the number of software businesses, technology businesses, and technology-enabled businesses in the U.S. generating between $1 million and $50 million in revenue is not publicly available.

• We have used available information to triangulate a rough estimate of the number of software and IT services businesses with revenues of $50 million and below.